Chewy stock price target raised to $48 from $39 at JMP Securities

Investing.com - JMP Securities raised its price target on Chewy Inc . (NYSE:CHWY) to $48.00 from $39.00 on Thursday, while maintaining a Market Outperform rating on the online pet retailer’s shares. According to InvestingPro data, 10 analysts have recently revised their earnings estimates upward, with the stock showing a strong 53.35% return over the past year.

The firm cited the substantial U.S. pet spending market, which totaled $152 billion in 2024, and highlighted the ongoing trend of pet humanization as a catalyst for future growth in the sector. Chewy has capitalized on this trend, generating $12.1 billion in revenue over the last twelve months, with a healthy gross profit margin of 29.24%.

JMP Securities noted that Chewy’s autoship program creates revenue visibility for the company, while also pointing to a clear path toward higher margins as advertising has room to increase.

The research firm expressed confidence that Chewy has potential for better-than-expected profitability growth, with current valuation levels not appearing challenged based on JMP’s hypothetical Blue Sky analysis.

JMP Securities believes there is room for analyst estimates on Chewy to move higher, potentially driving the stock price toward the firm’s new $48 target.

In other recent news, Chewy, Inc. reported significant developments impacting its financial and operational landscape. The company announced a $1 billion public offering of its Class A common stock by its largest shareholder, Buddy Chester Sub LLC, affiliated with BC Partners. Chewy will not receive proceeds from this offering but plans to repurchase and retire $100 million worth of its stock. This transaction is separate from its existing $500 million share repurchase program, which remains unaffected.

In terms of analyst activity, Citizens JMP assumed coverage on Chewy with a Market Outperform rating, raising the price target from $39 to $48. The firm highlighted Chewy’s potential growth in its advertising and health segments and expects its EBITDA growth to outpace revenue growth. UBS maintained a Neutral rating, noting Chewy’s sales momentum but expressing concerns about its profitability trajectory. Needham also reiterated its Hold rating due to valuation concerns despite acknowledging Chewy’s strong market position. These recent developments provide investors with varied insights into Chewy’s financial health and growth prospects.

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